{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-10T05:40:26-04:00", "answer_date": "2024-06-10 05:40:26", "is_docs_available": "", "is_excel_available": "", "is_pdf_available": "", "count_file_available": 0, "main_page": "student_question_view", "question_id": "2570531", "url": "\/study-help\/questions\/assume-that-in-the-original-ityesi-example-in-table-2570531", "question_creation_date_js": "2024-06-10T05:40:26-04:00", "question_creation_date": "Jun 10, 2024 05:40 AM", "meta_title": "[Solved] Assume that in the original Ityesi exampl | SolutionInn", "meta_description": "Answer of - Assume that in the original Ityesi example in Table , all sales actually occur in the United States and are projected | SolutionInn", "meta_keywords": "assume,original,ityesi,table,sales,occur,united,states,projected,$60.0,million,per", "question_title_h1": "Assume that in the original Ityesi example in Table , all sales actually occur in the United States and are projected to be $60.0 million", "question_title": "Assume that in the original Ityesi example in Table , all sales", "question_title_for_js_snippet": "Assume that in the original Ityesi example in Table , all sales actually occur in the United States and are projected to be $60 0 million per year for four years Keeping other costs thesame, calculate the NPV of the investment opportunity Assume the WACC is 6 8 The forward exchange rates are given below Assume that in me nngmal llyesl example iii Ianle a all sales attually accur innie United Hales and aie prsieciea m be 550,0 iiiiIIieii per yea mi oui years, Keeping om nsls me same camulae me NW at me Investment oppmm nity Assume me WAGE is 5 5 The larwald exchange iaies aie given helm Yea I 'l 2 3 I Forward Exchange Rate (WE) 1,6000 1 5551 15) i5 1 4692 1,4280 Calcualte me cash aws below Rmmd m miee decimai places Forward exchange i219 must be miinded ID uni decimal places ) Year 0 a Data Table Free cash aw (miHans gr puunds) Faiwani exchange rate Free cash Haw (mEUOnS gr dullars 5316 m the US WHOM manna ) TAB LE 31 1 Expected Foreign Free Cash Flows from Ityesi's U K Fmiect S P R E AD 3 H E ET Cash (law (milluns at dnars) Year I 2 4 lncmmantll Earnings Forecast E millions) 1 Sa les 7 37 500 37 500 37 500 371500 Cost at Goods Sold (15 625) (15 625) (15 625) (15 625) Gross meit 7 21 875 21 E75 21 875 11 875 Opsratmg Expenses 44 167) 5 625) (5 625) (5 625) 5 625) Damecialion 7 3 750) (3 750) (3 750) (3 750) EBIT (4 167) 12 500 12 500 12 500 12 500 Incnme tax at 40 1 667 (5 000 (5,000) (5,000) 5 000) Unlevered Net Income (2 500) 7500 7 500 7 500 1500 a Cash Flaw Plus Depreciation 7 3 750 3 750 3 750 L355 Capal Expenditures (15 000) 7 7 7 Less Increases in NWC 7 7 7 7 Pound Frle Cash Flow (17 500) wi'wimmhuh 5 KS", "question_description": "
Assume that in the original Ityesi example in Table<\/span>, <\/span>all sales actually occur in the United States and are projected to be <\/span>$60.0<\/span> <\/span>million per year for four years. Keeping other costs thesame, calculate the NPV of the investment opportunity. Assume the WACC is <\/span>6.8%<\/span>. <\/span>The forward exchange rates are given below.<\/span><\/p> <\/span><\/span><\/p>